Boeing [BA] and the Air Force agreed to change their development contract for the service’s Family of Advance Beyond Line-of-Sight Terminals (FAB-T) to fixed-price, a Boeing spokesman said.
“Following close coordination with our Air Force customer, Boeing has completed the transition of our FAB-T development contract to a firm-fixed price structure,” Boeing spokesman Matthew Billingsley said.
“The Air Force and Boeing agreed to a fixed price contract arrangement that was cost constrained and had defined schedule milestones,” an Air Force official said in an email Friday. “The milestones emphasize completion of terminal integration and testing while providing adequate funds for Boeing. This arrangement limits U.S. government cost liability.”
The announcement, which was first reported by Reuters, ends weeks of speculation over whether Boeing would bid on an alternate source for FAB-T, the Air Force’s next generation satellite communications terminals, or modify its original program of record. Boeing Network and Space Systems President Roger Krone told Defense Daily in late March that he didn’t, at the time, have a change in his contract, “but if it were to happen, then we would not bid on the alternative and we would, again, modify the program of record in a way that allows the government to create competition between what Boeing has done and, hopefully, will complete, and the alternative” (Defense Daily, March 26).
Billingsley said, overall, Boeing continues to make good progress on FAB-T.
“The hardware qualification has been completed, the software development and systems integration is expected to be finished this summer and we look forward to entering system functional qualification testing in 2013,” Billingsley said.
The Air Force said in late February it would issue a Request for Proposals (RFP) for an alternate source for FAB-T as a “hedge” against prime contractor Boeing not being able to provide the capabilities the service needs.
The service told Boeing on Jan. 4 it intended to terminate the contract, but on Jan. 9, the company submitted a firm fixed-price proposal to the Air Force to complete the FAB-T development. On Jan. 13, Boeing issued a “not to exceed” for production. Although they weren’t firm proposals, the service said it was enough to catch the eye of the Pentagon’s acting acquisition executive, Frank Kendall, who decided it would be “bad for business” to not re-evaluate Boeing’s proposals.
FAB-T is an information and communications system that provides the link enabling strategic nuclear command and control using the Milstar Extremely High Frequency (EHF) and Advanced Extremely High Frequency (AEHF) waveforms. The Air Force has been concerned that Boeing will not be able to provide the capability it needs.